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Minister overboard

Keeping meddling politicians out of the shipbuilding contract decision worked. Is there a lesson here?

The Conservatives are most anxious that everyone should know what an independent and impartial process was used to decide the recent competition for $33 billion in federal shipbuilding work. And by all accounts it was. Ministers were kept far away from the file. The task of assessing the competing bids, from shipyards in B.C., Halifax and Quebec, was left to a team of senior civil servants. A “fairness monitor” vouched for their handiwork, with the help of two outside auditors. And so on.

All of which would be a lot more impressive if a) it had not already been decided at the political level that no foreign shipyards would be allowed to compete, reserving the bidding to a handful of high-priced domestic yards, b) it had not similarly been decided in advance that the work would be divided between two yards, meaning two of the three bidders were guaranteed to win something, and c) one of the three, Quebec’s near-bankrupt Davie Yards, had not been shoehorned into the bidding at the last minute thanks to a political decision to extend the deadline. Indeed, it is hard to escape the impression that all this scrupulousness was based less on principle and more on protecting the government from the inevitable blowback from whichever province lost, naming no Quebecs.

But why quibble? It would be a stretch to say the best bid won, but at least the worst bid lost, which is a lot better than these things usually play out. Indeed, the process was such a success some have been moved to ask: why don’t we do this . . . all the time? If it is a good thing to keep politicians’ thumbs off the scales on a major shipbuilding contract, why is it not also a good thing to get the politics out of procurement generally? Not only would it spare the taxpayer needless expense, but it would spare the country the regional resentments, lobbying wars and suspicions of corruption that go with most such decisions.

I’d go further. Many of the worst political scandals of recent years, from sponsorships to the G8 mess, have stemmed in one way or another from ministers meddling in their departments’ affairs, whether to the benefit of their party, their constituents, their friends or themselves. That ministers will meddle may be thought of as a given. But ministers would be a lot less tempted to meddle if they did not actually have the power to do so: if they were removed from any role in the day-to-day management of departments, by means of a statutory separation of the two.

If that sounds like an unpardonable limit on the discretion of elected officials, recall that we already do this in many areas of government. It’s why the courts are insulated from political influence, at least after the judges have been appointed. It’s also why we set up Crown corporations, at arm’s length from their departments. So why don’t we apply the arm’s length model more broadly—making departments less the plaything of their ministers, and more organizations devoted to delivering the best service for the lowest cost?

I’m hardly the first to suggest this: in fact, I’m pretty much describing the system already in effect in New Zealand. As part of a program of reforms in the 1980s, New Zealand turned every government department into something resembling a Crown corporation. Deputy ministers became CEOs, hired on fixed five-year terms. Instead of simply issuing directives to his deputy minister, the responsible minister negotiates an annual contract with the department CEO, setting out broad policy objectives, together with benchmarks for measuring progress. Then the CEO is left to get on with the job, with broad powers to hire and fire and otherwise manage the department as he sees fit.

In effect, the minister becomes the purchaser of services on the public’s behalf, rather than the provider. He is still accountable for the mandate the department is given, and for seeing that it is met: indeed, since the terms of the contracts are public, the effect is to greatly clarify expectations and responsibilities. But he no longer has any role in how they’re delivered. So the minister of transport still sets the broad outlines of transport policy: he just doesn’t get to decide which roads go through whose ridings. Conscientious ministers ought to find this quite liberating. It frees them to focus on their proper role: setting policy for the country, rather than skulking around in their departments’ backrooms, deciding where to place gazebos and the like.

What are the chances we’ll see such a system here? As always in this country, inertia reigns. Even a gentle nod in this direction by Judge Gomery, in his report on the sponsorship scandal, provoked the great and the good of the Ottawa mandarinate to descend from on high to explain how it Simply Couldn’t Be Done. But in fact we have a working example: the Bank of Canada. Every five years the governor and the minister of finance agree upon the course of policy, including the target rate of inflation. Then the governor is left to get on with the job.

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